Why is it taken as axiomatic that the Tories are better at running the economy?

First topic message reminder :

The myth of Tory economic competence should be confronted every time that it's suggested. The Tories don’t tell you that they needed an IMF loan in 1956, that they left behind a huge balance of payments deficit in 1964 (which Labour turned into a surplus by 1970), that they gave us double-digit inflation in 1974 and then left a debt equivalent to 43.76% of GDP in 1997. They don’t tell you that in the month before Thatcher was booted out in 1990, inflation was higher than when she came in, or that the Tories left office in 1997 with unemployment higher than when they came to power on the strength of those ‘Labour isn’t working’ posters in 1979. They don’t mention the two recessions their policies caused in the 1980s, and they certainly won’t talk about ‘Black Wednesday’ in 1992.

The other side of the coin is to peddle the lie that every Labour government leaves behind a financial mess. It wasn’t true in 1951, not true in 1970 and not true in 1979. Much of the IMF loan sought in 1976 (following the effects of the quadrupling of the price of oil) was never taken up, and the economy was growing steadily until Thatcherism was inflicted on it.

'The mess' was only true in 2010 because Gordon Brown had no alternative but to bail out the bankers when global capitalism proved itself to be a failure, but even then the economy had started to grow until Osborne stamped on the green shoots of recovery. The longest uninterrupted period of growth in the UK economy in the last 200 years occurred when Brown was chancellor of the exchequer. The Tories supported Labour’s spending plans until the global credit crunch occurred, and the Tories supported the bailout of their banking cronies, who Cameron thought had been subject to too much regulation. The UK's deficit prior to the global financial crisis (which few economists predicted, which no politicians could have avoided and which could hardly be blamed on one government's fiscal policy) was lower than it had been in the mid-1990s. But trust the Tories not to let the truth ever get in the way of their mythology.

Norway has an $885billion savings advantage over the UK.

http://www.msn.com/en-gb/money/news/norway%e2%80%99s-dollar885bn-nil-advantage-in-britain%e2%80%99s-sea-of-social-troubles/ar-AAlTi3y?li=AA54rU&ocid=iehp

I Was thinking the other day how interesting it would be to look back at the Tory Parties economic record from 2010 to 2016 . As I believe it would be most interesting to compare some of the old data with the new data of just last year 2016.

We hear a great deal from both the Tory Party and there many friends within the Media & City of London about Conservative economic competence and how accomplished they are at running UK plc. we are also informed that know other party can be trusted with the UK economy. So before we start Brexit, let all take a little look back and you make up your own mind to there record.

Lets Start with the UK National Debt..

At the end of the Last Labour Government, the UK National Debt was as follows
1997/98 National Debt £352 Billion (ONS)
2007/08 National Debt £527 Billion  (ONS)
2010/11 National Debt £902 Billion   (ONS)
in 2007 the Public Sector debt fell from 40.4% to 36.4% of GDP.  In 2005 the UK National debt was less than £0.5 Trillion or just 38% of GDP.
By the End of the Cameron Government we see that the UK National debt was up to £1.56 Ttillion or if you like 81.58% of GDP. Under Mrs May's Govenment the UK National Debt stands at £1.6 Trillion or 83.7% of GDP.
However, at the Budget time in March 2017 : the UK National Debt is estimated to of hit £1.64 Trillion.  
So due to the UK Government significant budget deficit. The UK National debt is in fact increasing by approximately £73.5 Billion per annum under the Cameron Government. Or if you like £1.4 Billion per week. In 2012 the annual cost of servicing the public sector debt amounted to around £43 billion or roughly 3% of UK GDP.

So what are our Public sector net cash requirements (psncr) figurs for 2014/15? well that was £93.39 Billion or 5.2% of UK GDP (ONS)  However, The Institute of Economic Affairs. No friends of the Labour party I may add. They estimated the current  Liabilities, that include state and Public pensions. As well as other commitments made by this Tory party government  have put the National debt to be near £5 Tillion pounds. As figur that I happen to agree with myself. If a bit on the Conservative side by me.

So I believe we go into Brexit with the worst UK National debt that we have ever had since WW2. I  also expect to see UK Government borrowing to carry on going up even higher then it is today. I also feel that given the Tories record on the UK National debt that we could well see us hit £2 Trillion within this next five years. As Brexit could well add to this debt with the Tories putting Billions into the City of London financial servive sector.

What is very clear is that while the UK National debt saw a rapid increase in the aftermath of the world wide financial crisis of 2008. it also quite clear that the increase in the UK National debt was being meet within the 2008/2009 and 2010/11 UK debt figurs. Yet both the UK media and Tory Party and friends still cliam Economic competence within UK Voters and media as a whole?  Quite unbelievable or unimaginable 20 years ago. However, I have been watching this for some time now, and I believe that many people cannot fully understand the difference betweetn trade deficit from a UK National debt.  So when the Media reports the Trading deficit and they plan to balance the books. people believe this means the UK National debt is going down. I think the Tories and there friends within the Media have used this economic confusion very well.


UK GDP.
Angain this is also a most interesting set of data. So lets take a look at it. So under the last Labour Government we see the following records.
GDP The last cycle of robust growth in potential output of 2.9% was 1997 to 2006 (OBR & Oxford Economic)
GDP when the Tory-Liberal coalition come to power ,the UK was growing at an annual rate of 4% (OBR)
We are told that the last UK GDP growth in Q3 2016 was 0.6% and this shows we have a strong Economy. Yet in 2011 we had GDP in Q4 of 0.5% (OBR) at the time of the Tory Party budget in 2011. we was told that the forecast for growth would be 1.7%.
yet since they have been in power, the Tories have failed to get GDP Growth anywhere near the 2.9% growth from 1997 to 2006. yet have been borrowing more and more money against a far low GDP rate.  In fact public sector net borrowing, exluding public sector banks was £1.698 Billion to December 2016.  

So in all this time we are still seeing UK GDP Q1 to Q4 with growth stuck at under 1% while being told we have a strong Ecomony? Well I know what my view is.. but wonder if you really believe our GDP is strong going into BREXIT?

The domestic economic performance and the UKs ability to attract new trade deals and capital from overseas has never been tested like it going to be over the next ten years or so. as the truth is no one really knows how Brexit will work for our domestic economy. However, the last Cameron Government and this Mrs May government have show to me that there economic polices have left us weaker than at anytime i can think of since the 1970s while adding Trillion to the UK National debt. What is also very clear to me is that Brexit is a conflict between economic abstract theory and actual economic practice within the real trading world. as can the UK Economy withstand trade market pressures to come? as we go into Brexit holding record levels of UK National debt behind us and know real idea what are public expenditure will be ratcheted up too. as always the radical right almost evangelical talk of an economic miracle promised by there free market economics that just remains a figment of faith rather than a realisable economic goal.

For me. The Tories have no financial strategy for Brexit or our economy as i think i show above. but now over to you.

The weakness of a Tory government has been fairly well exposed on the pages of "Cutting Edge" but the blame for the events of 2008 can be fairly levelled at the so-called (that's a very contemporary use of words, as you know) ECONOMISTS who totally failed to predict the Credit Crunch.

Recently, students at British Universities have criticised the poor teaching of the subject, and complain that their exams comprise multiple-choice papers that allow no room for discussion or original expression.

I Think you have missed the point of my topic that I posted Oftenwrong. but never mind other websites got it right and understood what i was saying. it was not about Tories running of the Economy as such. what i was trying to ask was given the state of the Tories running of the UK Economy can the UK withstand a Brexit? based on the currant economic dater? As i believe there is no fiscal Economic plan in place for UK Brexit? in fact some in the House of Lords and Commons have now picked up on this whole question.

by the way.. i do know a very Economists who did in fact predict the Credit Crunch. but as always they was over looked at the time. still not that any of that matters right now.

I also do agree that British Universities have been very poor a teaching this Subject, its been bad for sometime now. you really need to hold good discussions and debates between the left and right of Economic thinking. such as Peter Jays work Englandits. or The Futer that does't work by R Eet Tyrell. or Economic Trends and Crisis in the UK economy. i could go on and on. but will not

The May doctrine of "not revealing their hand before negotiations" is thought by many to be a simple smokescreen for "not having a clue what to do".

If that proved subsequently to be no less than the reality - what's likely to be the public's reaction?

The response of people would fall into three broad categories :

(a) she will be pilloried by those who opposed her all along;
(b) she will, irrespective, be defended stoutly and illogically by those who are rabid Brexcusers;
(c) some will at last realise their error in trusting her and voting to leave the EU - but I suspect that this group will be relatively small...

Sadly Phil I think you're right

It had to happen sometime...

Speaking of long odds, it's a racing certainty that the May government will make such a howling mess of Brexit that the 2020 general election will be up for grabs as a bewildered electorate search for a vaguely competent alternative.

Let's hope there is one by then - one that is prepared to deliver socialist policies would be my preference

http://news.sky.com/story/chancellor-announces-u-turn-on-ni-tax-rises-10802683

(A week is a long time in Politics)

One of the generous gifts to the nation which IDS left, has been "Universal Credit",
which to nobody's surprise now appears to be at the least, optimistic-description.

Councils have an absolute duty to house certain categories of claimant, the cost of which has been balanced hitherto by Housing Benefit. But Universal Credit is not payable during the first six weeks of homelessness.

Accumulating rent arrears are now crippling local councils' housing budgets.

What was that about joined-up government?

It is a genuine nightmare - I live in an experimental 'full roll out' area and all the town's advice services are drowning under the tide of claimants who are becoming homeless due to delays in payment, claimants who don't have access to a computer, claimants who don't have the skills to use the new system, claimants who haven't eaten this week

It is thirty years since Saint Margaret of Fond Memory told mutually-owned Building Societies that they could transform themselves into a Bank. Depositors found themselves issued with "windfall" shareholdings in the newly-privatised mortgage lenders.

If anyone still holds any of those shares, they're probably by now worth what you paid for them: Nothing.

I spent mine instantly - first time in my life I had new furniture

Apparently Mrs.May would like to have an answer to the topic question too.

What will the election result tell her?

"‘Toilet closures will protect services’, says councillor after residents raise concerns."

http://www.bournemouthecho.co.uk/news/15239609.___Toilet_closures_will_protect_services_____says_councillor_after_residents_raise_concerns/?ref=mr&lp=9

(Less means more)

Good 'ere, innit? Mustn't let Labour spoil it, eh?

More obviously, former Chancellor "George" Osborne never met any of his budget targets for reduced borrowing.

May surprises ....

http://uk.reuters.com/article/uk-britain-election-care-idUKKCN18E1XK

Has nobody in the government ever read "Logan's Run"?

https://en.wikipedia.org/wiki/Logan%27s_Run

Evidence is accumulating that the High-speed railway to the North is a taxpayer cow just waiting to be milked by the Tories' pals in the City:

Govt borrowing jumps 43% to nearly £7bn (Sky News)

Figures from the Office for National Statistics (ONS) showed net borrowing, excluding state-owned banks, increased by £2bn to almost £6.9bn in June compared with the same month last year - a rise of 43%.

http://www.msn.com/en-gb/money/news/govt-borrowing-jumps-43percent-to-nearly-%c2%a37bn/ar-AAoxwWF?li=AA54rU&ocid=mailsignout

Why is it taken as axiomatic that the Tories are better at ruining the economy?

Just glancing at the title of the thread, for a glorious brief moment I misread (see above) had no end of comments to make

A better question, as things have turned out.

Yes

Fabulous news that years of austerity have finally delivered strong economic growth...

UK is the worst performing advanced economy in the world

GDP grew at just 0.2% during the first three months of this year – slower than all other G7 and European countries. Though the figures are only for one quarter, they add to other bleak economic indicators. The ONS also revealed that UK households are now experiencing the most prolonged squeeze on income since 1976-77. Adjusted for inflation, incomes fell 1.4% in the first three months of 2017 as prices rose sharply while wage growth was slow.

http://www.independent.co.uk/news/business/news/uk-economy-world-worst-performing-advanced-countries-state-g7-european-union-a7817046.html

Today, in just one day, here are typical headlines from the financial press:

May in Double Brexit Trouble as EU, Labour Raise Obstacles.

Construction growth slumps to one-year low.

Growth in UK services sector falls to 11-month low.

UK car sales fall again in August.

Bank of England unlikely to hike interest rates before 2019 but pound could fall further.

Pay up until 2023, German EU chief tells UK.

Liam Fox admits UK doesn't have the 'capacity' to strike international trade deals.


Is there something they are trying to tell us?

we're screwed, not to put too fine a point on it

The Tories pretend that the 1970s were terrible years. Yes, the quadrupling of oil prices almost overnight had a damaging effect on the economy, and the incoming Labour government in 1974 inherited double-digit inflation. Although much of it was never used, Labour sought an IMF loan in 1976 (just as the Tories had in 1956, but they never remind you of that). The recovery, helped as North Sea oil started to be brought ashore, was such that Britain’s standard of living rose by 6.4% in one year (1978) to reach its highest ever level.

It was also in 1978 that Britain received a Triple A credit rating, which it maintained for the next 35 years. On becoming chancellor in 2010, George Osborne said he wanted to be judged on whether the Tory-led government kept that rating. In 2013 it was downgraded to AA, and now this week Moody’s have further reduced the rating to a single A. It means that the government can expect to pay a higher rate of interest on money that it borrows.

Ivan wrote:The Tories pretend that the 1970s were terrible years....

On becoming chancellor in 2010, George Osborne said he wanted to be judged on whether the Tory-led government kept that rating. In 2013 it was downgraded to AA, and now this week Moody’s have further reduced the rating to a single A. the government can expect to pay a higher rate of interest on money that it borrows.

Though Gideon Osborne himself doesn't worry about the cost of borrowing, as he has six well-paid jobs.

Why is it taken as axiomatic that the Tories are better at running the economy?

I think the simple answer is that we assume that rich people know about money

Quite so, boatlady. Rich people can usually be relied upon to conserve their money - that's how they are brought up to behave - but that isn't enough to qualify them as "wealth-creators" - quite the reverse.

I dispute whether wealth is ever "created", though it is regularly re-distributed as we have seen since 2008. Added-value has usually come from the sweat of someone's working-class brow.

I'm inclined to think that 'wealth' (still waiting for a reliable definition) is definitely created or enhanced by working folk - as you say by the sweat of their brow - the rest of us just count the proceeds